NMBA: Foreclosures Up in Florida and Nationally
The number of Florida homes in foreclosure or seriously behind in payments hit record highs during the quarter ending Sept. 30, the National Mortgage Bankers Association reported on Thursday.
Florida had the dubious distinction of leading the nation in foreclosure inventory. It also ranked second in loan installments over 90 days late and fourth in the nation in the association's overall compendium of delinquency statistics.
Florida, California, Arizona and Nevada accounted for 43 percent of all foreclosures started during the quarter. In addition, more than two out of three foreclosure starts involving adjustable rate mortgages, a popular financing method when property values are expected to rise quickly, were also attributed to those states.
Nationally, 9.6 percent of 44.6 million loans serviced in the United States during the quarter were delinquent. On a seasonably adjusted basis, Southern states led the list with the highest rate of delinquencies at 10.2 percent.
The dismial outlook is not expected to turn around any time soon,” according to MBA chief economist Jay Brinkmann. Instead, a number of factors must first improve before the foreclosure rate begins to significantly decline.
“The outlook is that delinquency rates and foreclosure rates will continue to worsen before they improve,” Brinkmann said in a statement accompanying the report. “First, it is unlikely the employment picture will get better until sometime next year and even then jobs will increase at a very slow pace.
“Perhaps more importantly, there is no reason to expect that when the economy begins to add more jobs, those jobs will be in areas with the biggest excess housing inventory and the highest delinquency rates,” Brinkmann said.
Florida’s recovery may be hampered by the greater inventory caused by the precipitous drop on second home sales and the state’s above average unemployment rate. Pockets of extremely high unemployment continue along the Treasure Coast an in Southwest Florida, where foreclosure rates are also higher.
Alex Sanchez, president and CEO of the Florida Bankers Association, defended the banking industry earlier this week, telling reporters on Wednesday that most of the foreclosures have been the product of subprime lenders, mortgage companies and banks not affiliated with the Federal Deposit Insurance Corporation.